NU Online News Service, June 6, 2003, 5:31 p.m. EDT — Washington
Private insurers would have a major role in providing a new Medicare prescription drug benefit under a bipartisan agreement announced yesterday.
Under the plan, all Medicare beneficiaries, whether they enroll in the traditional fee-for-service plan or the managed care plan, would have the option of purchasing a subsidized prescription drug benefit offered by private health plans.
Specifically, beneficiaries who enroll in the managed care plan (currently called Medicare plus Choice but to be renamed Medicare Advantage) would be able to purchase integrated benefit packages that include prescription drugs.
Those in the fee-for-service plan would be able to purchase separate drug coverage from private plans.
The premium for the coverage would be $35 per month. Following a $275 deductible, the new coverage would pay half of all prescription drug expenses up to $3,450 annually.
The coverage is suspended at that point until a beneficiary’s out-of-pocket expenses reaches $3,700. Once that threshold is reached, the new coverage would pay 90% of all costs.
Beneficiaries would still be able to purchase Medigap policies to limit their out-of-pocket exposure.
The total cost of the plan is pegged at $400 billion over 10 years.
Senate Finance Committee Chairman Charles Grassley, R-Iowa, who developed the agreement with the Committee’s Ranking Democrat, Sen. Max Baucus, D-Mont., said at a press briefing that the committee will vote on the bill June 12.
He hopes, he said, that the proposal will be considered on a bipartisan basis and approved by the full Senate by July 4.